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|27 October, 2017

Lebanon Central Bank to launch digital currency

Central Bank Governor Riad Salameh announced that Banque du Liban intended to launch its own digital currency.

Lebanon's Central Bank Governor Riad Salameh speaks during an interview with Reuters at his office in Central Bank in Beirut, Lebanon October 24, 2017.

Lebanon's Central Bank Governor Riad Salameh speaks during an interview with Reuters at his office in Central Bank in Beirut, Lebanon October 24, 2017.

REUTERS/Jamal Saidi

BEIRUT: Central Bank Governor Riad Salameh announced Thursday that Banque du Liban intended to launch its own digital currency. “We understand that electronic currency will play a prominent role in the future. But BDL must first make the necessary arrangement before taking this step and develop [a] protection system from cybercrime. Both the Special Investigation Commission and Banking Control Commission are cooperating to prevent such electronic crimes,” Salameh told participants in the 7th CSR Lebanon Forum.

The governor said the new digital currency will fall under Lebanese law and be monitored by BDL.

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But the governor did not give any indication how the new currency would be introduced in Lebanon.

The governor reiterated his opposition to the use of bitcoin in Lebanon because it is not well regulated.

Salameh said that bitcoin and similar currencies are a big threat to the consumer and payment systems.

“These [bitcoin] are not currencies but rather a commodity whose prices rise and fall without any justification. For this reason, BDL has banned the use of this currency in the Lebanese market. The digital currency will be issued by BDL and will be available in the next few years,” he added.

Salameh reiterated that there is no threat against the Lebanese pound thanks to the $43.5 billion in foreign reserves held by BDL.

“This is reassuring, and our words are based on facts and figures. Coverage of the Lebanese pound in foreign currencies is high. There is also an important availability of foreign currency in the Lebanese banking sector. Therefore, there is no need to have a demand for the lira to secure foreign currencies. The objective of the financial architecture of the Central Bank aims to secure the stability of the national currency and protect the Lebanese economy,” the governor said.

The CSR Lebanon Forum has drawn hundreds of participants from many companies and banks, underlining the importance of corporate social responsibility.

“Brands that will survive in the future are the ones that have a social impact,” said Rana Ghandour Salhab, partner at Deloitte, Middle East, and an outspoken advocate of CSR, including the advancement of women professionals in Lebanon.

She was speaking as part of a panel at an all-day CSR conference at Beirut’s Phoenicia Hotel.

Corporate social responsibility, also sometimes known as corporate citizenship or responsible business, is a growing movement worldwide whose concept was coined in the 1950s, and whose practice dates to the beginning of organized business.

Although the definitions of CSR vary, it is generally understood as a corporation actively showing responsibility toward its environment, community and its employees through projects and policies. The concept has faced controversy over the years, with some critics accusing corporations of using it as a public relations tool, and in other cases raising concerns over self-regulation in the private sector. But in the many cases of genuine CSR, in which companies have put their long-term social responsibility ahead of short-term profits, the results have been largely positive.

Experts believe that as CSR continues to gain momentum around the world – due largely to a well-informed, socially and environmentally conscious younger generation – the practice will increasingly become integrated throughout companies’ structures, rather than just a nominal department. CSR Lebanon founder Khaled Kassar, in his welcome note, describes the movement as going beyond the traditional private versus nonprofit company model and using “entrepreneurial principles to organize, mobilize and manage a for-profit business that has a social mission at its core and the goals of creating both economic and social value.”

Millennials, as both consumers and employees, are actively seeking CSR-conscious companies. Eight out of ten millennials choose brands based on their CSR impact, and 60 percent of millennials will pay a premium for that impact. In the coming decade, this generation will be running these companies.

“They’re most interested in the impact, not what company is donating to charity,” said Ahmad Ashkar, founder and CEO of the Hult Prize Foundation, a student competition for social good. As the son of Palestinian refugees in the U.S., he initially felt he should get a prestigious job to make his parents proud, but during the 2008 financial crisis he discovered that what was more important for him and others was the satisfaction of making a social impact.

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